Industry Slams Conn. Bill Requiring Open, Affordable Internet

A fresh stab at creating a state net neutrality law met industry opposition this week. Connecticut’s joint General Law Committee held a hearing Thursday on a wide-ranging bill (SB-3) that would also require affordable broadband, ban junk fees, require streaming TV prorating and let consumers repair electronics. The legislature’s consumer protection bill “addresses inequities,” said Senate Majority Leader Bob Duff (D).

Bill opponents include national telecom industry associations NCTA, CTIA and the Wireless Infrastructure Association (WIA). “The FCC is poised to adopt net neutrality regulations this year making SB 3 unnecessary and potentially conflicting and preempted,” warned CTIA, which filed separate testimony opposing the bill’s junk fees and right-to-repair sections.

SB-3 would require that the Consumer Protection Department develop a process by Jan. 1, 2026, for an annual certification from broadband providers that they comply with net neutrality principles, including not blocking lawful content or non-harmful devices and not impairing or degrading lawful traffic based on content. It would allow "reasonable network management practices" that are disclosed to consumers. Companies would also need to say they aren’t doing paid prioritization or "unreasonably interfering with or ... disadvantaging" a customer's ability to choose broadband service or lawful content or devices or an "edge provider's ability to make lawful content or devices available to a customer.” Also, a certified provider couldn't do any "deceptive or misleading marketing practice that misrepresents the treatment of Internet traffic or content to" customers."

Users could lodge net neutrality complaints at the department under SB-3. Upon finding a company failed to comply with net neutrality, the consumer protection commissioner "shall conduct a hearing ... and after such hearing shall issue orders to enforce the provisions of this section,” it said. The commissioner could assess a civil penalty up to $10,000 for each violation. SB-3 would let the commissioner waive the ban on paid prioritization if the broadband provider adequately shows "that the practice would provide a significant public benefit and would not harm the open nature of the Internet in the state,” the bill said.

SB-3’s affordable broadband section would restrict state procurement contracts with any broadband internet access service (BIAS) provider that fails to provide an affordable plan to eligible households. Starting Oct. 1 this year, providers would have to offer a plan costing at most $40 monthly with at least 25 Mbps download and 3 Mbps upload speeds, plus "[s]ufficient speeds and latency to support distance learning and telehealth services." A household would be eligible if it participates in certain other public assistance programs. The bill would set goals for BIAS providers to ensure 90% of eligible households receive affordable broadband by 2025 and 95% by 2028.

SB-3 also would declare a non-enforceable state policy seeking digital equity for all residents and ensuring everyone has access to broadband that's sufficient, reliable, ubiquitous and affordable, among other things. Also, the section mentions “an increasing need for symmetrical network speeds” and prioritizing public broadband investments “to connect entire communities and address digital redlining in historically unserved and underserved communities." Other sections of the bill would prohibit junk fees, ban certain foreign-made drones, require disclosures about voice recognition features on connected devices, require streaming TV providers to provide prorated refunds for canceling customers and give customers a right to repair electronics.

Lawmakers may want to reduce the maximum price of the proposed affordable plan to $30 monthly to align with the federal affordable connectivity program (ACP), Doug Casey, Connecticut Commission for Educational Technology executive director, said at Thursday’s hearing. Also, increase speeds to 100/20 Mbps, which is Connecticut’s broadband standard, he said. Many people can’t afford $30 monthly, said Casey, whose office developed Connecticut’s digital equity plan.

Industry bashed many aspects of the state bill. Possible Connecticut net neutrality rules will cause confusion and hinder investment and innovation, said WIA in written testimony. Instead, the federal government should decide -- and the FCC is actively considering -- the issue, it said. “While WIA has concerns with the FCC’s direction, the FCC’s action emphasizes that it is not the right time for Connecticut to act.” SB-3 would create compliance costs for broadband providers that could have gone to deployment, WIA added.

“It is unnecessary and would be counterproductive and unlawful for the State to impose the affordability and net neutrality mandates contemplated by SB 3,” NCTA wrote. Even if ACP isn’t renewed, NCTA’s cable members already have plans for less than $40 monthly, it said. Requiring that price would be rate regulation, it said. Meanwhile, NCTA members “have made public commitments” about net neutrality and the FCC “is poised to adopt a final order within the next few months,” it said. The New England Connectivity and Telecommunications Association (NECTA) raised similar concerns.

A better path toward broadband affordability is by supporting the ACP, said Verizon. “Indeed, we were disappointed when this body didn’t adopt a resolution calling for Congress to act to renew the program as many states and organizations have.” SB-3, on the other hand, “will needlessly deter investment and slow deployment.” Verizon added that federal law preempts state regulation of broadband.

Dish and DirecTV condemned the bill’s prorating requirement for streaming TV. “When consumers cancel their subscription, they continue to have access to the service through the remainder of their subscription period and are not charged again.” Streamers don’t provide a daily rate, they said. “This business model is necessary to provide the streaming content that our customers want at a competitive price.”

Conversely, Connecticut Consumer Counsel Claire Coleman supported SB-3. Requiring affordable internet plans “is particularly important given 186,531 CT households enrolled in ACP could lose their internet connection” this May, the consumer advocate wrote. She acknowledged the FCC probably will preempt state net neutrality rules and enforcement. “However, the FCC final rules are likely to be challenged in court” so “there is no harm in proactively protecting consumers and passing this section into law, just as states like California and Vermont have done.”

Six states enacted net neutrality laws after the previous FCC under Republican Chairman Ajit Pai reversed federal laws: California, Colorado, Maine, Oregon, Vermont and Washington. Some set rules like the FCC previously had, while others limited state contracts or state subsidies to ISPs that follow net neutrality principles. Montana, New York, New Jersey, Hawaii, Rhode Island and Vermont governors signed executive orders. Industry dropped a lawsuit against California after losing at the 9th U.S. Circuit Court of Appeals (see 2205050041), while separate ISP litigation against Vermont’s law remains pending in the U.S. District Court of Vermont (see 2307260024).